UPDATE 1-U.S. confirms import duties on Canadian paper

(Adds official confirmation of duties, background on
electricity component of subsidy calculation)

WASHINGTON Oct 14 (Reuters) - The U.S. Department of
Commerce confirmed import duties on uncoated printing paper from
Canada in a final ruling released on Wednesday.

Commerce set final anti-subsidy duties on paper from
Canada's Port Hawkesbury Paper at 20.18 percent, slightly below
the preliminary ruling, after a complaint by U.S.-based Madison
Paper Industries of Maine, owned by Finland's UPM-Kymmene Corp
, and Verso Corp of Ohio.

Duties were increased to 17.87 percent for Resolute FP
Canada Inc and to 18.85 percent for all other exporters of the
paper, used to produce such materials as magazines, catalogs,
corporate brochures, flyers and directories.

The U.S. International Trade Commission is due to make its
final decision in the case by Dec. 4.

It was not immediately clear whether the final ruling
counted the provision of cheap electricity as a subsidy as the
preliminary decision had. The duties aim to compensate for
unfair government support received by foreign companies.

The U.S. companies argued that Nova Scotia Power, owned by
Canadian energy company Emera Inc, provided electricity
too cheaply to Port Hawkesbury on the orders of the regulator,
giving the Canadian company an unfair advantage.

But Canada's government and lawyers for Port Hawkesbury had
warned that counting a private contract to provide discounted
power as a subsidy would set a dangerous precedent.